Sales Reps eventually move up the ranks of the sales team to become the Sales Managers. As a Sales Rep, they only had to manage their own sales pipeline, it was fairly easy to assess their sales pipeline. They were very familiar with each of the deals in their sales forecast, they had a great sense of what would close and a rough idea of when.
But assessing an entire team’s sales pipeline is completely different. As a manager, you won’t know the ins and outs of every deal. You are relying on your team to inform you of their progress.
1. The shape of your sales pipeline
We typically think that a sales pipeline is a funnel shape, with a wide top and a narrow bottom. However, a healthy sales pipeline is more like a wide-mouthed champagne glass.
You want the majority of your drop-offs near the top, where the lead reaches the first major milestone in the process. After this milestone, the pool shouldn’t narrow much more. In a healthy pipeline, once a lead makes it past this milestone, it should be highly likely to close and create a new customer.
2. Revenue Amount vs Number of deals
The majority of sales teams work off a revenue target, and that is what sales managers focus on when assessing pipeline and forecasting. But looking at the deals in the pipeline may be a more accurate measure.
A pipeline containing a large amount of revenue but a low number of deals is high risk. What happens if the biggest deal falls through? There is nothing to fall back on to make up for the lost revenue, and the entire pipeline falls to pieces. Rather than focusing all of your energy on closing your biggest deal, a good sales manager will have a replacement plan.
3. Removing deals
There are times when you need to remove a deal from the pipeline; when the customer buys from your competitor, when they go quiet or they are dragging on. Although we will always advise a salesperson to check back in with these prospects occasionally, they shouldn’t stay in your pipeline. To keep the pipeline healthy, you should have a timeframe for removing deals from your pipeline.
Managing your team’s sales pipeline is a big part of a Sales Managers job. By looking at these three areas, you can ensure a healthy pipeline and an accurate forecast. Other areas that you could look at is how quickly deals move through the pipeline and discounting habits. If you have a rep that is discounting more than others, or your team heavily discounts as you move closer to the end of the month, then you might need to look at your value proposition or retrain your team.
We understand the demand for quality leads and the need for your team to meet those demands. We are here to help and add value by finding tangible, highly qualified leads where we have secured a date and a time for an appointment. These individuals are in your target audience, at the right decision-making level and have an interest in your solution. Taking away this pressure from your Sales team allows them to focus their time on closing deals and generating revenue.